CF Industries Offers $47.40 Per Share for Terra Industries

DEERFIELD, Ill.--(BUSINESS WIRE)--CF Industries Holdings, Inc. (NYSE: CF) today announced that it has
offered to acquire Terra Industries Inc. (NYSE: TRA) for $37.15 in cash
and 0.0953 of a share of CF Industries common stock for each Terra
share. The offer has a total value of $47.40 per share based on CF
Industries closing price on Monday, March 1, 2010. CF Industries has
received $4.05 billion of financing commitments and the offer is not
subject to financing. Morgan Stanley Senior Funding, Inc. has committed
$2.8 billion and The Bank of Tokyo-Mitsubishi UFJ, Ltd. has committed
$1.25 billion. CF Industries also announced that it intends to commence
an exchange offer for Terra shares that will be scheduled to expire on
April 2, 2010.

"It is clear that CF Industries is the best acquirer for Terra given the
compelling strategic benefits of the combination, including the
substantial synergies only we can achieve together," said Stephen R.
Wilson, chairman, president and chief executive officer of CF
Industries. "We withdrew our prior offer because we believed that Terra
was unwilling to agree to a sale. Now that Terra is for sale, we have
made an offer that is superior to Yara's substantially lower, highly
conditional offer."

The offer is subject to Terra terminating its merger agreement with Yara
and entering into a merger agreement with CF Industries and other
customary conditions set forth in the merger agreement.

The following letter was sent to the Terra Board of Directors:

March 2, 2010

Board of Directors

Terra Industries Inc.

Terra Centre

600 Fourth Street

P.O. Box 6000

Sioux City, Iowa 51102-6000

Attention:

Henry R. Slack, Chairman of the Board

Michael L. Bennett, President and Chief Executive Officer

Dear Members of the Board:

CF Industries is offering to acquire Terra Industries for consideration
per Terra share of $37.15 in cash and 0.0953 of a share of CF Industries
common stock. Our offer has a value per Terra share of $47.40 based on
CF Industries closing price on Monday, March 1, 2010. The offer is not
subject to financing. We intend to commence an exchange offer and will
be prepared to accept shares for payment in 30 days.

We are sending a form of merger agreement to your advisors that would be
signed once you have terminated your agreement with Yara. Our offer is
superior to Yara's substantially lower, highly conditional offer.

As you acknowledged in your preliminary proxy statement, in early
January we requested that Terra provide additional information so that
we could be in a position to increase our offer. As you are aware, we
were advised that no information would be provided to us because "Terra
is not for sale." Following this response, we withdrew our offer, and we
have not had any further communication with you.

We do not understand how Terra could have entered into an agreement with
Yara without giving CF Industries an opportunity to bid on a level
playing field. We also do not understand how Terra could have accepted
an offer from Yara with a risk adjusted present value that we believe
was not higher than the offer CF Industries had made in December 2009.
The value of any offer from Yara must be discounted for the lengthy
period to closing, as well as the risk that numerous conditions beyond
Terra's control will not be satisfied, including regulatory, legislative
and stockholder approvals.

We are more convinced than ever of the strategic benefits of this
transaction. This combination is clearly in the best interests of our
respective stockholders, employees and customers. We look forward to
putting our two great companies together.

Sincerely,

Stephen R. Wilson

Chairman, President and Chief Executive Officer

CF Industries Holdings, Inc.

CF Industries has obtained a total of $4.05 billion of financing
commitments to fund the transaction, refinance debt and provide for a
revolving credit facility. Morgan Stanley Senior Funding, Inc. has
committed $2.8 billion and The Bank of Tokyo-Mitsubishi UFJ, Ltd. has
committed $1.25 billion. CF Industries anticipates that following the
closing of the transaction, it will effect a public offering of common
stock in an amount equal to approximately $1 billion. CF Industries
expects the transaction to be significantly accretive to earnings, both
before and after such equity issuance.

CF Industries Holdings, Inc., headquartered in Deerfield, Illinois, is
the holding company for the operations of CF Industries, Inc. CF
Industries, Inc. is a major producer and distributor of nitrogen and
phosphate fertilizer products. CF Industries operates world-scale
nitrogen fertilizer plants in Donaldsonville, Louisiana and Medicine
Hat, Alberta, Canada; conducts phosphate mining and manufacturing
operations in Central Florida; and distributes fertilizer products
through a system of terminals, warehouses, and associated transportation
equipment located primarily in the Midwestern United States. The company
also owns a 50 percent interest in KEYTRADE AG, a global fertilizer
trading organization headquartered near Zurich, Switzerland. Additional
information on CF Industries is found on the company's website at www.cfindustries.com.

Additional Information

CF Industries Holdings, Inc. (“CF Industries”) intends to file a
Registration Statement on Form S-4 and a Tender Offer Statement on
Schedule TO (collectively with a Letter of Transmittal and related
documents, the “Exchange Offer Documents”) with the Securities and
Exchange Commission (the “SEC”) in connection with the proposed offer
(the “Exchange Offer”) by Composite Merger Corporation, an indirect
wholly-owned subsidiary of CF Industries, to exchange each issued and
outstanding share of common stock of Terra Industries Inc. (“Terra”) for
$37.15 in cash and 0.0953 shares of CF Industries’ common stock. The
Exchange Offer has not yet commenced. This press release is for
informational purposes only and does not constitute an offer to
exchange, or a solicitation of an offer to exchange, shares of Terra
common stock, nor is it a substitute for the Exchange Offer Documents.
The Offer will be made only through the Exchange Offer Documents.

In addition, CF Industries has filed a registration statement (including
a base prospectus) for the public offering of securities to which this
communication relates. Before you invest, you should read the prospectus
in that registration statement and, when filed, the applicable
prospectus supplement and other documents CF Industries files with the
SEC for more complete information about CF Industries and any public
offering of securities.

Security holders and investors may obtain any of the foregoing
documents, including the Exchange Offer Documents, for free by visiting
EDGAR on the SEC website at www.sec.gov
or by calling Innisfree M&A Incorporated toll-free at (877) 456-3507.
Free copies of the prospectus and the prospectus supplement for any
public offering of securities may also be obtained, when available, from
CF Industries or the underwriters to be identified in the prospectus
supplement. SECURITY HOLDERS AND INVESTORS OF CF INDUSTRIES AND TERRA
ARE URGED TO READ ANY SUCH DOCUMENTS CAREFULLY IN THEIR ENTIRETY BEFORE
MAKING ANY INVESTMENT DECISION IF AND WHEN THEY BECOME AVAILABLE BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE EXCHANGE OFFER AND ANY
PUBLIC OFFERING OF SECURITIES.

Forward-Looking Statements

Certain statements contained in this press release may constitute
‘‘forward-looking statements.’’ All statements in this press release,
other than those relating to historical information or current
condition, are forward-looking statements. These forward-looking
statements are subject to a number of risks and uncertainties, many of
which are beyond our control, which could cause actual results to differ
materially from such statements. Risks and uncertainties relating to the
proposed transaction include: Terra’s failure to accept CF Holdings’
proposal and enter into definitive agreements to effect the transaction;
our ability to obtain approvals on the proposed terms and schedule;
uncertainty of the expected financial performance of CF Holdings
following completion of the proposed transaction; our ability to incur a
substantial amount of indebtedness in connection with the proposed
transaction, to comply with the covenants in such indebtedness and to
make payments under such indebtedness when due; our ability to
consummate an equity offering following the closing of the proposed
transaction; CF Holdings’ ability to achieve the cost-savings and
synergies contemplated by the proposed transaction within the expected
time frame; CF Holdings’ ability to promptly and effectively integrate
the businesses of Terra and CF Holdings; and disruption from the
proposed transaction making it more difficult to maintain relationships
with customers, employees or suppliers. Additional risks and
uncertainties include: the relatively expensive and volatile cost of
North American natural gas; the cyclical nature of our business and the
agricultural sector; the global commodity nature of our fertilizer
products, the impact of global supply and demand on our selling prices,
and the intense global competition in the consolidating markets in which
we operate; conditions in the U.S. agricultural industry; risks
involving derivatives; weather conditions; our inability to predict
seasonal demand for our products accurately; the concentration of our
sales with certain large customers; the impact of changing market
conditions on our Forward Pricing Program; the reliance of our
operations on a limited number of key facilities and the significant
risks and hazards against which we may not be fully insured; reliance on
third party transportation providers; risks associated with joint
ventures; risks associated with expansion of our business, including
unanticipated adverse consequences and the significant resources that
could be required; future regulatory restrictions and requirements
related to greenhouse gas emissions, climate change or other
environmental requirements; potential liabilities and expenditures
related to environmental and health and safety laws and regulations; our
potential inability to obtain or maintain required permits and
governmental approvals or to meet financial assurance requirements; acts
of terrorism; difficulties in securing the supply and delivery of raw
materials we use and increases in their costs; losses on our investments
in securities; loss of key members of management and professional staff;
the international credit crisis and global recession; and the other
risks and uncertainties included from time to time in our filings with
the SEC. Except as required by law, we undertake no obligation to update
or revise any forward-looking statements.